Starbucks Announces Wage Hikes Amidst Labor Struggles

Outside view of Starbucks Coffee
by Ted O’Neil


Seattle-based Starbucks announced it will increase hourly wages next year as the coffee giant faces the dual pressures of unionization attempts and staffing shortages.

According to a press release from the company, starting in January of 2022, hourly employees with two or more years of service could see a 5% raise and those with five or more years of service could see a 10% raise.

By the summer of next year, the company says its average hourly pay will be $17, up from the current average of $14. Employees will make between $15 and $23 an hour across the country, depending on location and tenure.

The press release did not address what impact the moves will have on coffee prices.

The announcement comes as many chains struggle to fill open positions. Domino’s Pizza, Chipotle Mexican Grill, and McDonald’s have all recently stated that staffing shortages are causing delays in customer service.

Costco on Tuesday said it is raising its minimum hourly pay $1, up to $17. Amazon, also based in Seattle, increased its starting hourly wage to $15 last year, as did Target and Best Buy.

“As Starbucks celebrates our 50th anniversary, we are reminded that our heritage is based on the simple concept that our green apron partners are the heartbeat of Starbucks and success is best when it’s shared,” President and CEO Kevin Johnson said in the release. “Today, we are announcing another historic investment in our partners, knowing that when we take care of our partners, they take care of our customers and all stakeholders benefit. This is how we continue to build a great and enduring company. One that is committed to the ideal that doing good for one another — and for society — is good for business over the long term.”

Employees at three Starbucks locations in the Buffalo, New York area are attempting to unionize. The group, Starbucks Workers United, petitioned the National Labor Relations Board in August seeking to conduct a vote.

Attorneys for the company told the NLRB that if a vote is approved, employees at all 20 locations in the Buffalo area should vote, rather than allowing individual locations to vote. If the NLRB sides with the company, the union would need support from a majority of employees in order to organize. The NLRB is expected to make a decision next month.

Starbucks said it has also made investments aimed at expanding and retaining its workforce. That includes a $200 referral bonus for employees who recruit new members, an app that allows workers to more easily trade shifts, and self-serve cold beverage machines to ease employees’ workloads.

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Ted O’Neil contributes to The Center Square.



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